Auto industry of China (Source: Xinhua)


The history of the industry is simple, Chinese automakers used to manufacture foreign brands under license, then they began developing and producing new models with foreign companies, and now they are building their own research centers, and nurturing homegrown brands.

However, for many years homegrown brands were regarded as low-end, substandard products in China because many of them proved unreliable.



That is now a thing of the past. Homegrown brands such as Red Flag and Roewe are now moving into the more lucrative high-end market currently dominated by foreign automakers.


Homegrown brands are "a beautiful butterfly that is struggling free of its ugly chrysalid", said Chen Guangzu, an expert with the China Automotive Industry Consultative Committee.



For instance, Geely's ambitions know no bounds. The company has said it wants to be a world famous brand by 2015, with an annual output of two million cars, including 1.3 million sold overseas.


Geely just put China's first continuously variable valve timing (CVVT) engine into production in its plant in Ningbo, in east China's Zhejiang Province. Great Wall said it would equip all its SUVs and pick-ups with its newly developed oil-saving diesel engine. Meanwhile, both Brilliance and Chery turned out their own 1.8T turbo engines.

The year 2006 saw Chinese homegrown brands reach a new level of sophistication -- besides improving product quality and exterior design, they are now developing their own engines.

Statistics show that homegrown brands are taking an increasing share in the domestic market for passenger cars, up from 10.5 percent in 2004 to 26 percent in 2005. Tianjin Xiali, Chery and Geely rank among the top 10 best sellers in 2005.


Sales of homegrown brands outperformed those of Chinese-foreign joint ventures in the first two months this year.


China, once known as the kingdom of bicycles, has been transformed over the last two decades into a car culture, with vehicle ownership up 30 times between 1985 and 2004.